9330 Zionsville Road
Indianapolis, Indiana 46268
March 15, 2024
LETTER FROM CHAIRMAN
AND CHIEF EXECUTIVE OFFICER
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| Dear Investor: On behalf of the Board of Directors (the “Board”), we are pleased to invite you to the Annual Stockholder Meeting of Corteva, Inc. (“Annual Meeting”), which will be held virtually on April 26, 2024 at 8:00 a.m. Eastern Daylight Time. Included with this letter, you will find a notice setting forth the agenda for the Annual Meeting, along with our Proxy Statement discussing these agenda items in more detail and how to participate in the Annual Meeting. |
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Our Performance
In 2023, our teams delivered solid performance in technology penetration, customer delivery and productivity that allowed us to continue to grow our margins, despite crop protection supply imbalances. Given our strong results for the full year 2023, we returned more than $1.2 billion to stockholders during the year via dividends and share repurchases, while also investing in research and development and $1.5 billion in biological acquisitions that will drive long-term value creation for our stockholders in the years to come.
As an agriculture technology company, our innovation on behalf of customers and our commitment to their productivity is the foundation of our ability to deliver long-term value for our stockholders and help sustain the planet by contributing to a secure, sustainable food and energy supplies. Our technologically advantaged, new seed technologies contributed significantly to our margin growth in 2023 with EnlistTM E3 soybeans becoming the number one soybean technology in the United States. In crop protection our sales of new more sustainable technologies outpaced our older technologies and we introduced 140 products from two new sustainable actives AdaveltTM and Reklemel®. Finally, the strategic and operational changes we’ve made over the last two years will continue to allow us to optimize our resource allocation, including returns to stockholders, as well as investment in our research capabilities, to drive the long-term value creation for our stockholders and customers.
Your Highly Qualified Board of Directors
Your Board is recommending for election at this year’s Annual Meeting a slate of its current highly qualified directors. Each of these individuals has been carefully vetted through recent board refreshment over the last several years to assure the right mix of expertise, experience, and perspective to provide the best possible oversight and guidance for the strategic direction of the Company. The Board slate proposed is diverse in background and skill, while also being well-experienced in agriculture, chemical manufacturing, and innovation.
Engagement
We believe it is essential to engage with all our stakeholders to assure that a mix of perspectives helps guide our value creation strategy. In 2023, members of our management team as well as members of our Board engaged in constructive dialogue with stockholders representing approximately 40% of the Company’s outstanding common stock to hear their perspectives on the Company’s business and innovation strategy, corporate governance policies, sustainability initiatives, human capital management, and compensation practices.
Your vote is very important, regardless of the number of shares you own. Whether or not you plan to attend the Annual Meeting, we hope you will vote as soon as possible. On behalf of the Board and management, we thank you for your continued investment in Corteva.
Sincerely,
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Gregory R. Page Chair of Board |
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Charles V. Magro Chief Executive Officer and Director |
Cautionary Statement About Forward-Looking Statements
This Proxy Statement contains certain estimates and forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended, which are intended to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and may be identified by their use of words like “plans,” “expects,” “will,” “anticipates,” “believes,” “intends,” “projects,” “estimates,” “outlook,” or other words of similar meaning. All statements that address expectations or projections about the future, including statements about Corteva’s financial results or outlook; strategy for growth; product development; regulatory approvals; market position; capital allocation strategy; liquidity; sustainability targets, aspirations, and initiatives; the anticipated benefits of acquisitions, restructuring actions, or cost savings initiatives; and the outcome of contingencies, such as litigation and environmental matters, are forward-looking statements.
Forward-looking statements and other estimates are based on certain assumptions and expectations of future events which may not be accurate or realized. Forward-looking statements and other estimates also involve risks and uncertainties, many of which are beyond Corteva’s control. While the list of factors presented below is considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties. Unlisted factors may present significant additional obstacles to the realization of forward-looking statements. Consequences of material differences in results as compared with those anticipated in the forward-looking statements could include, among other things, business disruption, operational problems, financial loss, legal liability to third parties and similar risks, any of which could have a material adverse effect on Corteva’s business, results of operations and financial condition. Some of the important factors that could cause Corteva’s actual results to differ materially from those projected in any such forward-looking statements include: (i) failure to obtain or maintain the necessary regulatory approvals for some of Corteva’s products; (ii) failure to successfully develop and commercialize Corteva’s pipeline; (iii) effect of the degree of public understanding and acceptance or perceived public acceptance of Corteva’s biotechnology and other agricultural products; (iv) effect of changes in agricultural and related policies of governments and international organizations; (v) costs of complying with evolving regulatory requirements and the effect of actual or alleged violations of environmental laws or permit requirements; (vi) effect of climate change and unpredictable seasonal and weather factors; (vii) failure to comply with competition and antitrust laws; (viii) effect of competition in Corteva’s industry; (ix) competitor’s establishment of an intermediary platform for distribution of Corteva’s products; (x) impact of Corteva’s dependence on third parties with respect to certain of its raw materials or licenses and commercialization; (xi) effect of volatility in Corteva’s input costs; (xii) risk related to geopolitical and military conflict; (xiii) risks related to environmental litigation and the indemnification obligations of legacy EIDP liabilities in connection with the separation of Corteva; (xiv) risks related to Corteva’s global operations; (xv) failure to effectively manage acquisitions, divestitures, alliances, restructurings, cost savings initiatives, and other portfolio actions; (xvi) effect of industrial espionage and other disruptions to Corteva’s supply chain, information technology or network systems; (xvii) failure of Corteva’s customers to pay their debts to Corteva, including customer financing programs; (xviii) failure to raise capital through the capital markets or short-term borrowings on terms acceptable to Corteva; (xix) increases in pension and other post-employment benefit plan funding obligations; (xx) capital markets sentiment towards sustainability matters; (xxi) risks related to pandemics or epidemics; (xxii) Corteva’s intellectual property rights or defense against intellectual property claims asserted by others; (xxiii) effect of counterfeit products; (xxiv) Corteva’s dependence on intellectual property cross-license agreements; and (xxv) other risks related to our separation from DowDuPont.
Additionally, there may be other risks and uncertainties that Corteva is unable to currently identify or that Corteva does not currently expect to have a material impact on its business. Where, in any forward-looking statement or other estimate, an expectation or belief as to future results or events is expressed, such expectation or belief is based on the current plans and expectations of Corteva’s management and expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the expectation or belief will result or be achieved or accomplished. Corteva disclaims and does not undertake any obligation to update or revise any forward-looking statement, except as required by applicable law. A detailed discussion of some of the significant risks and uncertainties which may cause results and events to differ materially from such forward-looking statements is included in the section titled “Risk Factors” of our Annual Report on Form 10-K.
VOTING AND ATTENDANCE PROCEDURES
registered form, plus all shares of common stock held for you at Computershare, will appear together on a single proxy voting form. If no instructions are provided by you on an executed proxy voting form, your shares at Computershare will be voted as recommended by the Board.
Participants in various employee savings plans will receive a voting instruction form. Your executed form will provide voting instructions to the respective plan trustee. If no instructions are provided, the plan trustees and/or administrators for the relevant employee savings plan will vote the shares according to the provisions of the relevant employee savings plan. To allow sufficient time for voting, your voting instructions must be received by 11:59 p.m. Eastern Daylight Time (“EDT”) on April 23, 2024. You may not vote your shares held in an employee savings plan in person at the 2024 Meeting.
Shares Outstanding and Quorum
At the close of business on the record date, March 1, 2024, there were 687,797,051 shares of Corteva, Inc. common stock outstanding and entitled to vote. Each share of common stock is entitled to one vote. The holders of at least 50% of the issued and outstanding shares of common stock entitled to vote that are present in person or represented by proxy constitute a quorum for the transaction of business at the 2024 Meeting.
Votes Required
For Agenda Item 1: Election of Directors, each nominee must receive the affirmative vote of a majority of votes cast with respect to each director nominee will be required for the nominee to be elected. A majority of votes cast means that each nominee must receive more FOR votes than AGAINST votes in order to be elected. For all other Agenda Items to be presented for a vote at the 2024 Meeting (Agenda Items 2, 3, and 4), each such item must receive more FOR votes than AGAINST votes in order to be approved. Abstentions will be included in determining the presence of a quorum at the 2024 Meeting, but will not be counted or have an effect on the outcome of any matter except as specified below with respect to Agenda Item 3.
Broker Non-Votes
A broker non-vote occurs when brokers, banks, or other nominees holding shares for a beneficial owner have discretionary authority to vote on “routine” matters brought before a stockholder meeting, but the beneficial owner of the shares fails to provide the broker, bank, or other nominee with specific instructions on how to vote any “non-routine” matters brought to a vote at the stockholders meeting.
Under the rules of the New York Stock Exchange, brokers, banks, and other nominees will be entitled to vote your shares on “routine” matters without instructions from you. The only proposal that would be considered “routine” in such event is Agenda Item 3, the proposal for the ratification of the appointment of PwC as Corteva’s independent registered public accountants for fiscal year 2024. A broker, bank, or other nominee will not be entitled to vote your shares on any “non-routine” matters, absent instructions from you. “Non-routine” matters include the election of directors and the approval, on a non-binding advisory basis, of the compensation paid to Corteva’s named executive officers, and the amendment to Corteva’s Certificate of Incorporation.
Consequently, if you receive proxy materials only from Corteva and you do not submit any voting instructions to your broker, bank, or other nominee, your broker, bank, or other nominee may exercise its discretion to vote your shares on the proposal to ratify the appointment of PwC. If your shares are voted on this proposal as directed by your broker, bank, or other nominee, your shares will constitute broker non-votes on each of the other proposals. Broker non-votes will count for purposes of determining whether a quorum exists, but will not be counted as votes cast with respect to such proposals.
A list of stockholders of record entitled to vote shall be open to any stockholder for any purpose relevant to the 2024 Meeting for ten days before the 2024 Meeting, during normal business hours, at the Office of the Corporate Secretary.
How Votes Are Counted
If you submit a validly executed proxy card or voting instruction form but do not specify how you want to vote your shares with respect to a particular proposal, then your shares will be voted in line with the Board’s recommendations with respect to any such proposal, i.e., (i) FOR the election of the Board’s 13 director nominees; (ii) FOR the non-binding advisory resolution approving the compensation paid to Corteva’s named executive officers, as disclosed pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables and narrative
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VOTING AND ATTENDANCE PROCEDURES
discussion; (iii) FOR the ratification of the appointment of PwC as Corteva’s independent public accounting firm for fiscal year 2024; and (iv) FOR the approval of an amendment of Corteva’s Certificate of Incorporation to provide for the exculpation of certain of our officers as permitted by Delaware law. If you submit a proxy card marked “abstain” on any item, your shares will not be voted on that item so marked and your vote will not be included in determining the number of votes cast on that matter.
If your shares are held of record by a bank, broker, or other nominee, Corteva urges you to give instructions to your bank, broker, or other nominee as to how you wish your shares to be voted so you can ensure your shares are voted at the 2024 Meeting.
As of the date of this Proxy Statement, the Board knows of no business other than that set forth above to be transacted at the 2024 Meeting, but if other matters requiring a vote do arise, it is the intention of the persons named in the proxy card to whom you are granting your proxy to vote in accordance with their good faith business judgment as to what is in the best interests of Corteva on such matters.
Proxy Solicitation on Behalf of the Board
Corteva is soliciting proxies to provide an opportunity for all stockholders to vote, whether or not the stockholders are able to attend the 2024 Meeting or an adjournment or postponement thereof. Directors, officers and employees may solicit proxies on behalf of the Company’s Board in person, by mail, by telephone or by electronic communication. The proxy representatives of the Board will not be specially compensated for their services in this regard. Corteva will reimburse brokers and other nominees for their expenses in forwarding proxy solicitation materials to holders.
Attending the 2024 Meeting
Our 2024 Meeting will be a completely virtual meeting with no physical meeting location. The meeting will only be conducted via live webcast. We believe this format will allow for greater participation of our stockholders generally, and reduced expense to the Company and the environment. Conducting a virtual meeting will also allow stockholders whose travel may be restricted to partake in the meeting.
Attendance at the 2024 Meeting or any adjournment or postponement thereof will be limited to stockholders of the Company as of the close of business on the record date and invited guests of the Company. To participate in the virtual meeting, visit www.virtualshareholdermeeting.com/CTVA2024 and enter the 16-digit control number included on your notice of Internet availability of the proxy materials, on your proxy card, or on the voting instructions that accompanied your proxy materials.
We are committed to ensuring our stockholders have the same rights and opportunities to participate in the 2024 Meeting as if it had been held in a physical location.
Stockholders may log into www.proxyvote.com if they want to submit questions in advance of the meeting. Pre-meeting questions will be cut-off at 11:59 p.m. EDT on April 22, 2024 to provide the Company time to respond and post both the questions and responses at the 2024 Meeting.
The 2024 Meeting will begin promptly at 8:00 a.m. EDT on April 26, 2024 and stockholders will have another opportunity to ask questions during the meeting. If you want to submit your question during the meeting, log into the virtual meeting platform at www.virtualshareholdermeeting.com/CTVA2024, type your question into the “Ask a Question” field, and click “Submit.”
Questions pertinent to meeting matters will be answered in connection with the 2024 Meeting, subject to reasonable time constraints. Questions regarding personal matters, including those related to employment or product or service issues, are not pertinent to meeting matters and therefore will not be answered. The Rules of Conduct for the 2024 Meeting will be available on the meeting platform, as well as Corteva’s investor relations website, www.investors.corteva.com. Questions answered in connection with the 2024 Meeting will be posted to the Company’s investor relations website, https://investors.corteva.com/, following the conclusion of the 2024 Meeting.
The virtual meeting platform is fully supported across browsers (MS Edge, Firefox, Chrome, and Safari) and devices (desktops, laptops, tablets, and cell phones) running the most updated version of applicable software and plugins.
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CORPORATE GOVERNANCE
Strong corporate governance supports our core values, and, as a result, Corteva is committed to applying sound corporate governance practices, which align with the interests of our stockholders and ensure the highest levels of integrity in the operation of our Board. Within this section, you will find information about our Board and corporate governance policies and practices.
BOARD OF DIRECTORS
Nomination Process. All candidates for Board membership are evaluated by the Governance and Compliance Committee. In evaluating candidates, including existing Board members, the Governance and Compliance Committee considers an individual candidate’s personal and professional responsibilities and experiences, the then-current composition of the Board, and the challenges and needs of the Company in an effort to ensure that the Board, at any time, is comprised of a diverse group of members who, individually and collectively, best serve the needs of the Company and its stockholders. The Governance and Compliance Committee may also consider recommendations from leading, global third-party search firms, whose function is to assist in identifying qualified candidates and to validate the background and reputation of any potential candidates. In general, and in giving due consideration to the composition of the Board at the time a candidate is being considered, the Governance and Compliance Committee considers each potential nominee’s:
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integrity and demonstrated high ethical standards; |
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experience with business administration processes and principles; |
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ability to express opinions, raise difficult questions, and make informed, independent judgments; |
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knowledge, experience, and skills in one or more specialty areas (such as accounting or finance, legal, regulatory or governmental affairs, human capital management, product development, agriculture or chemical industry, technology, global operations, or corporate strategy, among others); |
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ability to devote sufficient time to prepare for and attend Board meetings; |
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willingness and ability to work with other members of the Board in an open and constructive manner; |
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ability to communicate clearly and persuasively; and |
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diversity with respect to other characteristics, which may include, professional experience, skills, specialized education, socioeconomic background, gender, age, ethnicity, race, nationality, and other personal attributes. |
Inclusion. The Board is committed to diversity and inclusion and supportive of board candidates from underrepresented communities. We have taken steps to attract and retain Board candidates from diverse backgrounds, including with respect to skills, education, professional experience, personal attributes, gender, ethnicity, race, nationality, and age. When selecting Board candidates, the Board is focused on the individual’s experience in the context of the needs of the Board in the pool of potential candidates under consideration, while balancing the need to identify candidates for nomination that add to, or otherwise complement, the skills and qualifications of its existing members through regular refreshment of our Board. During any Board refreshment process, we are mindful that we want the best talent for our Board and that our Board aspires to be representative of the communities and geographies in which we operate.
Stockholder Nomination Process. Stockholders who wish to submit names to be considered by the Governance and Compliance Committee for nomination for election to the Board of Directors may do so by contacting us through the Corporate Secretary Office, Corteva, Inc., 974 Centre Road, Building 735, Wilmington, Delaware 19805 and should submit the following information:
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the name and record address of the stockholder of record making such nomination and any other person on whose behalf the nomination is being made, and of the person or persons to be nominated, |
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the class or series and number of shares of capital stock of the Company which are owned beneficially or of record by such stockholder or such other person, |
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a description of all arrangements or understandings between such stockholder and any such other person or persons or any nominee or nominees in connection with the nomination by such stockholder, |
Corteva 2024 Proxy Statement | 5
CORPORATE GOVERNANCE
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such other information regarding each nominee proposed by such stockholder as would be required to be disclosed in solicitations of proxies for election of directors in an election contest, or is otherwise required to be disclosed, pursuant to the rules of the Securities and Exchange Commission had the nominee been nominated or intended to be nominated by the Board of Directors, and shall include a consent signed by each such nominee to be named in the proxy statement for the annual meeting as a nominee and to serve as a director of the Company if so elected, |
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a representation that such stockholder intends to appear in person or by proxy at the annual meeting to make such nomination, |
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a duly executed representation that, if elected as a director of the Company, the proposed nominee shall comply with the Company’s Code of Business Ethics and Board of Director’s Governance Guidelines in all respects, share ownership and trading policies and guidelines and any other Company policies and guidelines applicable to directors, as well as any applicable law, rule, or regulation or listing requirement, and |
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a completed and duly executed written questionnaire with respect to the background of the nominating stockholder and any other person or entity on whose behalf, directly or indirectly, the nomination is being made (which questionnaire shall be provided by the Corporate Secretary upon written request). |
Stockholders wishing to nominate a director should follow the specific procedures set forth in the Company’s Bylaws.
CORPORATE GOVERNANCE POLICIES
Director Independence. The Board of Directors has made the determination that all director nominees standing for election, except Mr. Magro, are independent according to the applicable rules and regulations of the Securities and Exchange Commission, and the New York Stock Exchange listing standards. It is the policy of the Board of Directors that every member of the Audit, People and Compensation, and Governance and Compliance Committees should be an independent director. The charters of each of these committees and the Board of Directors Corporate Governance Guidelines are available free of charge on the “Governance” section of the Company’s website at https://investors.corteva.com or upon written request to Corteva, Inc., 974 Centre Road, Building 735, Wilmington, Delaware 19805, Attention: Corporate Secretary Office. Changes to any committee charter or the Corporate Governance Guidelines will be reflected on the Company’s website.
Board Leadership Structure. Mr. Page is an independent director and currently serves as Chair of the Board of Directors. Our Corporate Governance Guidelines require the appointment of an independent Lead Director if our Chair is not independent. The term of any such Lead Director would be expected to be at least one year. We believe having an independent chair (or independent Lead Director, in an independent chair’s absence) focused on risk oversight, best positions our CEO to focus on strategic execution.
Risk Oversight. Risk is inherent in every material business activity that we undertake. Our business exposes us to strategic, regulatory, market, financial compliance, operational, and reputational risks. We utilize an enterprise risk management program to identify Corteva’s most significant risks and then prioritize our risk mitigation activities and resources around these risks. To support our corporate goals and objectives, risk appetite, and business and risk mitigation strategies, we maintain a governance structure that delineates the responsibilities for risk management activities, and the governance and oversight of those activities, between management and our Board.
Our enterprise risk management program is managed by the Company’s risk director, who supports the Company’s management in setting the Company’s risk appetite and in the identification and prioritization of Company risks and risk mitigation activities. The risk director reports to the Company’s Vice President, Chief Risk and Compliance Officer, who in turn reports to our Senior Vice President, General Counsel. The Governance and Compliance Committee retains oversight of the enterprise risk management program and makes recommendations for delegations of the oversight of certain risks to the Board’s committees. In addition to management providing the Board directly and through its committees regular enterprise risk management program updates through the year, the Vice President, Chief Risk and Compliance Officer has regularly scheduled executive sessions with the Governance and Compliance Committee.
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CORPORATE GOVERNANCE
Limits on Other Directorships. Pursuant to our Corporate Governance Guidelines, directors who are employed as an executive officer of another public company may only serve on a total of two public company boards, including the board of the company with which he or she is employed. Additionally, directors, who are not current executive officers of a public company, may serve on a maximum of four public company boards, including our Board.
Our current outside directorship limits are set at a level that allow the Company to compete for board talent with the appropriate levels of expertise and experience needed to provide effective oversight for our industry. Because the agriculture industry is consolidated, ensuring sufficient agriculture executive experience and expertise for our Board can be challenging. Our directors with the highest number of directorships are Messrs. Page and Everitt with three other public company boards each. Messrs. Page and Everitt each have over 35 years of global executive experience in the agricultural industry, along with experience as directors of agricultural companies, which is important to Corteva as a relatively new standalone agricultural company with a recently refreshed management team. See Agenda Item 1: Election of Directors for more information on their specific skills, expertise and experience. Both Messrs. Page and Everitt are retired and had solid levels of stockholder support last year, as well as strong aggregate Board and committee attendance of 96% and 90%, respectively, in 2023. Additionally, consistent with our committee chair rotation policies, Ms. Giesselman replaced Mr. Page as chair of the Governance and Compliance Committee on February 20, 2024, providing Mr. Page further bandwidth as our Chair.
Board Refreshment. As part of the Company’s Board refreshment process, our Certificate of Incorporation provides that all directors stand for election at each annual meeting of stockholders. Our Corporate Governance Guidelines provide that no director may stand for reelection to the Board after reaching age 75. The Board may in unusual circumstances and for a limited period of time ask a director to stand for reelection after the prescribed retirement date.
Committee Refreshment. The Governance and Compliance Committee evaluates its Committee composition and committee chairs for potential changes annually. The Board expects to rotate its Committee chairs every 5 years, with the incoming Committee chair serving on such committee for a minimum of one year prior to his or her appointment. The outgoing committee chair is expected to serve on such Committee for a minimum of an additional year to ensure an orderly transition. Under the Company’s Corporate Governance Guidelines, while the Board is expected to generally follow the principles above, the Board also may take into account Company facts and circumstances, and any other factors the Board believes are appropriate, to determine whether rotation of the committee chairs is appropriate and to select the individuals best-suited to serve in these roles.
Board Annual Performance Reviews. Under the Company’s Corporate Governance Guidelines, the Board annually conducts a self-evaluation of the Board’s performance as a whole. In addition, the Board annually evaluates individual director performance and effectiveness, with a minimum of one-third of the directors being evaluated each year on a staggered basis. The performance and effectiveness of each standing committee of the Board is also evaluated on an annual basis in accordance with their respective written charter. At least every three years, an evaluation of the Board’s performance and effectiveness will be conducted by an independent, third party overseen by the Governance and Compliance Committee. This may be conducted in substitute of, or separate from, an internally administered annual self-evaluation of the Board’s performance.
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CORPORATE GOVERNANCE
Code of Conduct. We have adopted a written Code of Conduct for directors as well as a Code of Conduct applicable to all officers and employees. Additionally, we maintain a written Code of Financial Ethics, applicable to our principal executive officer, principal financial officer, principal accounting officer, controller, and all employees performing similar functions. These policies are designed to maintain the integrity of our business, as well as the accuracy of our financial reporting. These codes cover, among other things, professional conduct, conflicts of interest, accurate recordkeeping and reporting, public communications, and the protection of confidential information, as well as adherence to laws and regulations applicable to the conduct of our business. Copies of these documents are available free of charge on the “Governance” section of the Company’s website at https://investors.corteva.com or otherwise upon written request addressed to Corteva, Inc., 974 Centre Road, Building 735, Wilmington, Delaware, 19805, Attention: Investor Relations.
Director Continuing Education. Pursuant to the Corporate Governance Guidelines, the Company provides new directors with an orientation to become familiar with the Company and its strategic plans and businesses, significant financial matters, core values, including ethics, compliance programs, corporate governance practices, and other key policies and practices, through a review of background materials, meetings with senior executives, and visits to Company facilities. When orientations are held, all directors are invited to take part. The Governance and Compliance Committee regularly evaluates and identifies opportunities to provide directors with ongoing education, including visits to Corteva operations, facilities, and business partners across the globe. Furthermore, the Company provides all directors with a subscription to the National Association of Corporate Directors’ publications and encourages directors to periodically attend these workshops and seminars regarding corporate governance and other topics. In addition to direct education, management provides regular business updates and other ad hoc communications to our Board to keep them abreast of matters relevant to our business and industry.
Communications with the Board. Stockholders and other interested parties may communicate directly with the Board, the non-management directors or the independent directors as a group, or specified individual directors, by writing to such individual or group c/o Corporate Secretary Office, Corteva, Inc., 974 Centre Road, Building 735, Wilmington, Delaware 19805. The Corporate Secretary will forward such communications to the relevant group or individual at or prior to the next meeting of the Board. The Board has instructed our Corporate Secretary to review the correspondence prior to forwarding it, and in his discretion, not to forward certain items if he deems them to be of a commercial or frivolous nature or otherwise inappropriate for the Board’s consideration. In these cases, the Corporate Secretary may forward some of the correspondence elsewhere in the Company for review and possible response.
BOARD COMMITTEES
Committees perform many important functions on behalf of the Board. The responsibilities of each committee are stated in their respective committee charters, which are available on the Company’s website, https://investors.corteva.com under “Governance”.
The Board, upon the recommendation of the Governance and Compliance Committee, elects members to each committee and has the authority to change Committee chairs, memberships, and the responsibilities of any committee as set forth in the Bylaws.
The Board currently has four standing committees: (i) Audit Committee; (ii) Governance and Compliance Committee; (iii) People and Compensation Committee; and (iv) Sustainability and Innovation Committee. All members of the Committees are independent under the Board’s Corporate Governance Guidelines and applicable New York Stock Exchange Rules. The Board has determined that Messrs. Engel, Page, and Ward, along with Ms. Grimes are each “audit committee financial experts” within the meanings of the applicable Securities and Exchange Commission Rules.
10 | Corteva 2024 Proxy Statement
SUSTAINABILTY AND OUR VALUES
OVERVIEW
Food is at the core of human needs and a critical resource for socioeconomic development. While our world is growing, our food resources are not. Therefore, Corteva is focused on continuing to drive sustainable innovation that brings progress and prosperity for future generations through sustainable food production. For us this means more than expanding the food supply. It also encompasses social, economic, and ecological considerations critical to achieving global food security, which is why we have built our sustainability programs around four focus areas: sustainable innovation; biodiversity; climate; and inclusion, diversity, and equity. As part of these programs, we’re encouraging sustainable planting methods by developing corn hybrids resistant to insects, diseases and herbicides, developing selective crop protection applications that limit impacts to the environment, and building an innovative workforce to design the advanced technologies that will provide growers with the tools to farm in a world with less arable land and more unpredictable weather conditions.
Corteva believes that companies contribute to sustainable growth efforts by engaging in regular, open dialogue with stakeholders about community and company issues and working together to solve problems. This includes our stockholders. In 2023, our directors and members of management continued our engagement efforts by meeting with stockholders representing approximately 40% of our common stock, outstanding as of December 31, 2023. While some stockholders declined to engage with us at that time, Corteva’s management and, in some circumstances, members of its Board, attended meetings to discuss the Company’s business and innovation strategy, sustainability initiatives, human capital management practices and corporate governance policies.
Sustainability initiatives are overseen by our Board and its committees. Our Sustainability and Innovation Committee regularly monitors the Company’s sustainability measures and efforts, and provides oversight of the risks related to climate change and the Company’s innovation pipeline, while our Governance and Compliance Committee retains oversight of our ethics, compliance and safety programs, which reinforce our values. Our People and Compensation Committee oversees the Company’s succession planning process, along with its human capital management and inclusion, diversity, and equity strategies. Sustainability, ethics, and diversity, inclusion, and equity matters are supported by the Company’s executive leadership team who make recommendations to our Board and committees and ensure alignment of sustainability initiatives with the Company’s strategy. Our executive leadership team is supported by senior management committees that make recommendations to our executive leadership team, and also implement the Company’s sustainability initiatives.
Winning Aspiration and Values
We aspire to be the leader of innovative sustainable solutions for growers worldwide, today and tomorrow in order to become the world’s most valuable agriculture solutions company. In order to achieve this aspiration, we focus on promoting a culture and managing our business in a manner that fosters innovation by promoting our values, which are striving to:
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Enrich Lives: We commit to enhancing lives and the land. |
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Stand Tall: We are leaders and act boldly; we accept the challenges that confront our industry as our own and will step up to ensure that agriculture progresses and thrives. |
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Be Curious: We innovate relentlessly. |
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Build Together: We grow by working together. |
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Be Upstanding: We always do what’s right, maintaining high ethical standards and conducting business safely and transparently. |
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Live Safely: We embrace safety and the environment in all we do. |
Transparency and Accountability
Corteva provides transparency to its stakeholders on sustainability through its sustainability reports, which include disclosures responsive to the Global Reporting Initiative (“GRI”), Sustainability Accounting Standards Board (“SASB”),
Corteva 2024 Proxy Statement | 15
ESG INITIATIVES AND OUR VALUES
and the Task Force on Climate-Related Financial Disclosures (“TCFD”). In 2023, Corteva participated in two Task Force on Nature-related Financial Disclosures (“TNFD”) pilots to guide the development of the TNFD and to better understand our nature-related opportunities and dependencies, as well as how to integrate nature-related risks into our decision-making processes. More information may be found in our next sustainability report, which is expected to be published in early April 2024 on our investor website, https://investors.corteva.com.
The Company’s sustainability programs and strategy is gaining the Company recognition for its efforts.
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• Corteva was named one of the “World’s Most Admired Companies” for 2024 by Forbes, ranking #1 in food production and #118 overall among a pool of approximately 1,500 U.S. and global companies. • Corteva was named a “Best Place to Work for Disability Inclusion”, for 2023 by the Disability Inclusion Index. The Disability Inclusion Index is the leading independent, third-party resource for the annual benchmarking of corporate disability inclusion policies and programs, with 70% of the Fortune 100 and nearly half of the Fortune 500 utilizing its benchmarking. |
Ethical and Secure Supply Chains
Corteva’s largely multi-sourced supply chains are designed to be resilient and reflect the high expectations Corteva sets for its suppliers. Corteva expects its suppliers to act consistently with Corteva’s values and to abide by our Supplier Code of Conduct, which establishes our policies with respect to fair wages, discrimination, human rights, ethical procurement practices, record-keeping, and compliance with applicable laws. Corteva will not tolerate the use of child or forced labor in any of its global operations and facilities. We, likewise, expect our suppliers and contractors to uphold our principles with respect to child and forced labor. Our Supplier Code of Conduct and Child and Forced Labor Statement may be found under the “Supplier Center” section of our website: https://www.supplier-center.corteva.com/.
Political Activities
Corteva is committed to participating constructively in the political process with the ultimate goals of advancing and protecting the best interests of the Company, our stockholders, and employees. The political process significantly impacts Corteva through government policies, legislation, and regulatory decisions. We are fully committed to conducting our political activities ethically and in compliance with our policies and all applicable campaign finance laws and reporting requirements. In 2023, Corteva was named one of the top decile of companies in Wharton’s Zicklin Center for Political Accountability’s “CPA-Zicklin Index” earning trendsetter status for its high level of transparency. More information related to Corteva’s policies and its political spending can be found at: https://www.corteva.com/who-we-are/political-disclosures.html.
Human Capital Management
We believe that attracting, retaining, and developing members of our workforce is key to the sustainability of our business and developing our pipeline for leadership. Our leadership is focused on fostering an environment in which employees are contributing fully and able to win for themselves, for Corteva and for our customers and stockholders. Corteva aims to attract the best employees, to retain those employees through offering career development and training opportunities while also prioritizing their safety and wellness in an inclusive and productive work environment. In order to promote this environment, Corteva prioritizes professional development and inclusion, diversity, and equity initiatives, and then monitors their effectiveness by measuring employee engagement, employee representation, and pay equity, along with reviews of its leadership succession pipelines.
We believe by supporting inclusion, diversity, and equity initiatives for employees of all backgrounds, Corteva can retain and attract the best talent and nurture a workforce with a greater variety of skills, perspectives, backgrounds and experiences, which we expect to foster the diversity of thought needed to drive our innovative culture into the future.
Led by Corteva’s Chief Human Resources and Diversity Officer, Corteva has undertaken the following inclusion, diversity and equity practices set forth in the table below. For more information on Corteva’s inclusion, diversity and equity (ID&E) practices, see Corteva’s website, www.corteva.com/who-we-are/our-diversity.html.
16 | Corteva 2024 Proxy Statement
AGENDA ITEM 1: ELECTION OF DIRECTORS
Non-Employee Directors Stock Grant
On April 21 2023, the Board granted equity retainer RSU awards, which will vest in their entirety on the first anniversary of the grant date. Each non-employee director serving on the Board received a grant of 2,770 RSUs. Mr. Page, as Board chair, received a grant of 4,720 RSUs, which reflects the equity portion of his non-executive chair fee, as well as his non-employee director equity retainer award.
Non-Employee Directors Stock Ownership Guidelines
The Company’s stock ownership guidelines require non-employee directors to own within five years from their respective appointment date, five (5) times their annual cash retainer in equity of the Company. Equity is a key component of director compensation in order to align their interests with those of the Company’s stockholders. In order to ensure the non-employee directors meet the guidelines, the Company maintains a stock holding requirement that requires the director to hold all equity compensation until he or she meets the stock ownership guidelines. The equity retainer awards granted since the Company’s inception through 2021 will not vest until the non-employee director retires from the Board. Beginning in 2022, equity retainer awards vested in their entirety on the first anniversary of the grant date. As of December 31, 2023, the non-employee directors were in compliance with the stock ownership guidelines, or are anticipated to reach their guideline within the prescribed timeframe.
Non-Employee Directors Deferred Compensation Plan
Non-employee directors may choose, prior to the beginning of each year, to have all or part of their fees credited or deferred to a Stock Accumulation and Deferred Compensation Plan for non-employee directors. Under the plan, a director may defer all or part of the Board retainer and Committee Chair fees in cash or stock units until retirement as a director or until a specified year in the future. Interest accrues on deferred cash payments and dividend equivalents accrue on deferred stock units.
Business Travel Accident Insurance for Non-Employee Directors
The Company maintains business travel accident insurance policies covering each non-employee director, which will cover accidental death and dismemberment if the director is traveling on Corteva business.
EQUITY COMPENSATION PLAN INFORMATION
The table below shows the Equity Compensation Plan Information as of December 31, 2023 for Corteva, Inc.
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(1) |
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(2) |
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(3) |
| Plan Category |
|
# of securities to
be issued upon
exercise of outstanding
options, warrants, rights |
|
Weighted-average exercise
price of outstanding
options, warrants, rights ($) |
|
# of securities
remaining available
for future issuance
under equity
compensation plans
(excluding securities
reflected in column (1)) |
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| Equity Compensation Plans Approved
by Security Holders |
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|
7,751,097 |
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|
|
$ |
33.81 |
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|
|
|
10,203,653 |
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|
|
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| Equity Compensation Plans not Approved
by Security Holders |
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|
|
0 |
|
|
|
$ |
— |
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|
|
0 |
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| Total |
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|
|
7,751,097 |
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|
|
$ |
33.81 |
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10,203,653 |
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30 | Corteva 2024 Proxy Statement
COMPENSATION DISCUSSION AND ANALYSIS
EXECUTIVE SUMMARY
2023 SUMMARY PERFORMANCE
Corteva’s compensation philosophy is to provide pay for performance in support of our long-term business objectives, as well as the achievement of annual targets. Corteva has been focused on becoming the leading global integrated agriculture technology solutions company by providing best-in-class germplasm and traits in its seed segment, creating many new products from an innovative pipeline such as QromeTM corn trait and the EnlistTM soybean trait, and increasing our emphasis on higher-margin patented & differentiated products in our crop protection segment, including RinskorTM, ArylexTM, , and our spinosyns franchise. In the seed segment, we continued to grow margins and Enlist™ E3 soybeans reached about 58% penetration in the U.S. for 2023, making it the number one selling soybean technology in this geography. While the crop protection segment saw inventory destocking that created imbalances in typical demand patterns, new product sales of our sustainable innovations outpaced previous technologies. Corteva produced approximately 400 new products in 2024 and continued to strengthen the sustainability of its portfolio with 100% of its seed and crop protection product pipelines meeting Corteva’s sustainable innovation criteria, thereby meeting our sustainability innovation goal and putting us on track for continued success as a technological innovator.
Underpinning Corteva’s progress was strong seed growth for 2023, and disciplined expense management. Despite market volatility and disruptions, Corteva responded and continued to capture the value of its technology in a manner that more than offset headwinds from market-driven cost inflation for inputs and logistics, and teams delivered over $285 million in cost savings from productivity initiatives contributing to Corteva’s margin expansion. This strong performance and balanced capital allocation strategy allowed Corteva to deliver more than $1.2 billion to stockholders via dividends and share repurchases, while still making significant investments in sustainable innovation organically and inorganically through the investment of $1.5 billion in biological acquisitions, along with other capital projects to secure the Company’s future growth.
Corteva launched its strategy to accelerate growth and drive long-term shareholder value with a revised operating model to drive accountability and improve performance, along with initiating portfolio changes to continue our focus on high growth and margin accretive products and markets. Consistent with these changes, we also evolved our compensation program in 2023 to further align our executive management’s compensation programs with our strategy and our stockholders’ interests and feedback by introducing business unit EBITDA and EBITDA margins metrics. As expected, these executive compensation program design changes drove greater accountability and action throughout the organization. With respect to our business unit leaders, the program rewarded the strong success our seed segment had in extracting value for its portfolio, while recognizing the headwinds experienced by our stockholders as a result of the inventory restocking trends in crop protection.
INVESTOR FEEDBACK
Last year, our say-on-pay proposal received the support of approximately 94% of votes cast — a significant indication that our stockholders support our compensation philosophy and programs. While we were encouraged by the significant level of support, we continued with stockholder outreach efforts in 2023, and plan to continue these efforts during 2024, allowing our investors the opportunity to engage with Corteva’s leadership. In meetings with our directors, stockholders may also have the opportunity to speak to independent directors without members of management present. These meetings included institutional investor executives, governance leads, and portfolio managers, among others. We solicited feedback from stockholders regarding their views on our business and capital allocation strategies, corporate governance policies, sustainability initiatives, greenhouse gas emissions, and human capital management and compensation practices. The Board welcomed these opportunities to discuss our compensation program with stockholders and took that feedback into consideration as we continued to evolve our compensation program and other governance policies.
COMPENSATION PROGRAM PRINCIPLES
Corteva’s executive compensation programs are designed to attract, engage, reward, and retain the high-quality executives necessary to lead the Company and execute our business strategy in alignment with the best interests of
Corteva 2024 Proxy Statement | 33
COMPENSATION DISCUSSION AND ANALYSIS
In addition to Company performance, the Committee considers a broad array of facts and circumstances in finalizing executive officer pay decisions, including competitive analysis, tally sheets, and stockholder feedback. As part of its annual executive compensation evaluations, the Committee considered each NEO’s scope of responsibility, experience, performance, results and potential. The Committee also considered the need to retain talent, business conditions, and the competitive compensation levels for comparable positions benchmarked against the Company’s peer group and general industry information.
Our compensation programs are dynamic, and the Committee actively updates such programs in response to changing circumstances to ensure that our executive officers’ compensation is aligned with our stockholders’ interests. The Committee retains the authority to adjust awards when in its discretion exceptional circumstances warrant such adjustments from the Company’s established incentive programs.
We Conduct a Competitive Analysis
Peer Group Analysis
To ensure a complete and robust picture of the overall compensation environment, and to provide consistent comparisons against which to benchmark compensation for the CEO and other NEOs, we utilize a select group of peer companies (“peer group”) to:
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Benchmark pay design including mix and performance criteria; |
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• |
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Test the link between pay and performance; and |
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• |
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Determine the competitiveness of the compensation paid to our NEOs. |
The peer group generally reflects the agricultural and chemical industries in which we operate, represents the multiple markets in which we compete — including markets for executive talent, customers and capital — and comprises large companies with a strong scientific focus and/or research intensity and a significant international presence.
To help guide the selection process in an objective manner, the Committee established the following criteria requiring peer group companies be:
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Publicly traded U.S. companies and select non-U.S. based companies traded on the New York Stock Exchange to facilitate pay design and performance comparisons; |
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• |
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Direct business competitors; and |
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• |
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Companies similar in size to Corteva — 1/3X to 3X revenue and market capitalization criteria. |
The Committee most recently reviewed Corteva’s peer group in July 2023 and reaffirmed their peer group first selected in 2022. The Corteva peer group for 2023 is set forth below.
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| 3M Company |
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DuPont de Nemours, Inc. |
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International Flavors & Fragrances, Inc. |
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| Air Products and Chemicals, Inc. |
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Eastman Chemical Company |
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Nutrien Ltd. |
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| Archer-Daniels Midland Company |
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Ecolab Inc. |
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PPG Industries, Inc. |
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| Avery Dennison Corporation |
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FMC Corporation |
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The Sherwin-Williams Company |
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| Celanese Corporation |
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Honeywell International Inc. |
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Zoetis Inc. |
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| Deere & Company |
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Published Compensation Surveys
In addition to benchmarking our compensation programs against our peer group, the Committee utilizes data obtained from published compensation surveys. The data utilized from these surveys represents large companies with median revenue comparable to Corteva’s. Data obtained from these published surveys are used in conjunction with peer group data in assessing the compensation of our NEOs and are used as a secondary source of data for assessing the compensation of our CEO.
Corteva 2024 Proxy Statement | 37
COMPENSATION DISCUSSION AND ANALYSIS
Tally Sheets
For each NEO, the Committee annually reviews tally sheets that include all aspects of total compensation and the benefits associated with various termination scenarios. Tally sheets provide the Committee with information on all elements of actual and potential future compensation of the NEOs, as well as data on retention linkages. This helps the Committee confirm that there are no unintended consequences of its actions.
COMPONENTS OF OUR EXECUTIVE COMPENSATION PROGRAM
The components of Corteva’s executive compensation program align with its executive compensation philosophy.
DIRECT COMPENSATION COMPONENTS
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| Pay Element |
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Role in Program/Objectives |
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How Amounts Are Determined |
| Base salary |
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• Provides regular source of income for NEOs • Provides foundation for other pay components (i.e., PRP targets expressed as a percentage of base salary) |
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Based on a range of factors, including peer data, market pay surveys, business results, and individual performance |
| PRP awards |
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• Align executives with annual goals and objectives • Create a direct link between executive pay and annual financial and operational performance |
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Actual payout is based on financial performance of Company, modified as applicable by ESG performance |
| LTI awards |
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• Link pay and performance — accelerate growth, profitability, and stockholder return • Align the interests of executives with stockholders • Balance plan costs, such as accounting and dilution, with employee-perceived value, potential earning opportunity, and employee share ownership objectives |
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Actual value realized is based on Company performance over a multi-year time frame and/or is linked to stock price |
Performance metrics for our short- and long-term incentive programs for our NEOs are established typically at the beginning of the calendar year in February. Adjustments to incentive award terms and conditions or criteria may be made by the Committee to recognize unusual or infrequent events affecting the Company or its financial statements, or due to changes in applicable laws, regulations, or accounting principles that are unrelated to the underlying operational performance of the Company. These adjustments can have either a positive or negative impact on award payouts.
On March 1, 2023, Corteva completed its acquisitions of the Stoller Group, Inc. (“Stoller”), one of the largest independent companies in the Biologicals industry, and Quorum Vital Investment, S.L. and its affiliates (“Symborg”), an expert in microbiological technologies (together “the Biologicals acquisitions”). With respect to PRP, the Committee excludes the impact of the acquisition in the year of acquisition given the performance period is limited to twelve months. With respect to PSU awards, the Committee excludes the impact of the sales, costs, and assets and liabilities from acquisitions completed during the performance year, if the performance payout is impacted plus or minus 5%. Additionally, with respect to PSU awards, the Committee excludes the impact of acquisitions which occur when more than 50% of the applicable performance award is complete. If 50% or more of the applicable performance period remains, performance targets may be adjusted for each of the performance years impacted by the acquisition (year of acquisition plus years following).
Target Compensation Pay Mix
To reinforce our pay-for-performance philosophy, Corteva targets a significant portion of our NEOs’ compensation to be “at risk”, tying each NEO’s compensation to the Company’s financial performance, the executive’s continued employment with the Company, and the performance of the Company’s common stock as indicated by our share price. We believe this approach motivates executives to consider the impact of their decisions on stockholder value.
38 | Corteva 2024 Proxy Statement
COMPENSATION DISCUSSION AND ANALYSIS
Change in Control and Executive Severance Benefits
To ensure that executives remain focused on Corteva business during a period of uncertainty that may arise in the case of a potential change in control, and to maintain the competitiveness of our overall executive compensation and benefit offerings, the Company maintains the Corteva, Inc. Change in Control and Executive Severance Plan. Each of the NEOs is a participant in the plan. For any benefits to be earned under the plan in association with a change in control, a change in control must occur and the executive’s employment must be terminated within two years following the change in control event, either by the Company without cause or by the executive for good reason (often called a “double trigger”). Under the Change in Control and Executive Severance Plan the CEO severance payout factor is 2.99.
The plan requires a release of claims as a condition to the payment of benefits and includes one-year non-competition and non-solicitation provisions and additional non-disparagement and confidentiality provisions. For additional information about benefits under the Change in Control and Executive Severance Plan see Potential Payments Upon Termination or Change in Control.
HOW WE MANAGE COMPENSATION RISK
The Committee regularly monitors our compensation programs to assess whether those programs are motivating the desired behaviors while delivering on Corteva’s performance objectives and encouraging appropriate levels of risk-taking. In 2023 the Committee engaged Cook to perform a risk assessment of its compensation programs. Cook’s review encompassed an assessment of risk pertaining to a broad range of design elements, such as mix of pay, performance metrics, goal-setting and payout curves, and payment timing and adjustments, as well as other mitigating program elements noted below. Cook’s analysis determined, and the Committee concurred, that Corteva’s compensation programs do not encourage behaviors that would create undue material risk for Corteva.
Payout Limitations or Caps
Payout limitations, or “caps,” play a vital role in risk mitigation, and all metrics in the PRP and PSU programs are capped at 200% to protect against excessive payouts.
Stock Ownership Guidelines
The Company requires that NEOs accumulate and hold shares of Corteva Common Stock with a value equal to a specified multiple of base pay. These targets are 6, 4, and 3 times base salary for Corteva’s CEO, executive vice presidents, and senior vice presidents, respectively.
Stock ownership guidelines also include a retention ratio requirement. Under the guidelines, until the required ownership is reached, executives are required to retain 75% of net shares acquired upon any future vesting of stock units or exercise of stock options, after deducting shares used to pay applicable withholding taxes and/or exercise price, as applicable.
For purposes of the stock ownership guidelines, we include direct ownership of shares and stock units held in employee plans and RSU awards. Stock options and PSUs are not included in determining whether an executive has achieved the ownership levels. NEOs are generally expected to reach these targets in five years of their respective hire date or the Separation, as applicable. Messrs. Anderson, Glenn, and King have met their ownership guideline. Messrs. Magro and Eathington are both expected to meet their guideline with the five-year target timeframe.
Compensation Recovery Policy (Clawback)
Effective December 1, 2023, Corteva revised its compensation recovery policy to comply with the NYSE Listing Rules and Section 10D and Rule 10D-1 of the Exchange Act. The policy covers each current and former employee of Corteva or an affiliated company who is, or was, the recipient of incentive-based compensation (“Grantee”) awarded following the
adoption of the policy, including each of our NEOs.
Under the policy, a mandatory clawback applies to our officers subject to Section 16 of the Exchange Act, if Corteva is required to prepare an accounting restatement due to its material noncompliance with any financial reporting requirement under securities law or is required to correct an error in previously issued financial statements that is material to the
Corteva 2024 Proxy Statement | 41
COMPENSATION DISCUSSION AND ANALYSIS
Annual Short-Term Incentives
Our PRP design for 2023 ensured that our executives maintained a strong focus on financial metrics closely linked to stockholder value creation over time. PRP awards were based on the below formula, measures, and weightings. The Committee approves the plan design and the factors for these metrics at the beginning of each fiscal year. Adjustments to incentive award terms and conditions or criteria may be made by the Committee to recognize unusual or infrequent events affecting the Company or its financial statements, or due to changes in applicable laws, regulations, or accounting principles that are unrelated to the underlying operational performance of the Company. These adjustments can have either a positive or negative impact on award payouts.
Consistent with Corteva’s 2022 business realignment and to further align our incentives with the interests of stockholders, the Committee approved a change for 2023 to its short-term incentive plan, PRP, to utilize business unit level plans to further align Corteva’s incentive programs with the accountability structure and increased performance transparency resulting from Corteva’s refined strategy and business unit structure. There are separate business unit plans for seed and crop protection (CP), with target metrics specific to those business units. NEOs not assigned to a specific business unit are subject to the enterprise plan for their PRP.
Under the enterprise plan, the Committee weights Operating EBITDA at 50% due to the importance of this metric to stockholders in measuring the effectiveness of our operational performance and the comparability of Corteva’s performance to peers. Operating EBITDA Margin and Working Capital Turns metrics each weighted at 25% are also included. The Operating EBITDA Margin metric is included in the design to allow more comparability to peers, and incentivizes Corteva’s strategy to innovate and price effectively for its technology, while exercising disciplined expense management. The Working Capital Turns metric is designed to incentivize Corteva’s operational excellence initiatives by encouraging working capital management practices that efficiently generate sales that can fund continued investment in growth, as well as returns to stockholders.
To drive further business accountability and performance transparency to our stockholders, the seed and crop protection business unit segment include the enterprise payout factor weighted at 60% and business unit Operating EBITDA and Operating EBITDA Margin targets weighted at 25% and 15%, respectively. These business unit metrics provide deeper visibility to business unit performance, more opportunities for peer comparability, as well as business unit expense management and price execution.
The ESG modifier is based on a holistic evaluation by the Committee of key accomplishments and actions taken during the year to advance Corteva’s values and sustainability performance, including attracting and retaining the best talent by building an innovative, inclusive culture and workforce, and increasing the sales of crop protection solutions that can deliver abundant high-quality food to the world in a more sustainable manner. The Committee believes the inclusion of the ESG modifier within the PRP reflects Corteva’s commitment to promoting values-driven leadership and sustainable innovation in a manner consistent with its long-standing, business-relevant environmental and social priorities. The Committee may choose to apply the ESG modifier to adjust the payout amounts upwards or downwards by up to 10% or determine not to make any adjustments. The Committee will not apply the ESG to increase the PRP payout above the overall cap of 200% of the total target payout opportunity under the program.
2023 PRP PERFORMANCE AND PAYOUT FACTOR
The table below highlights the business performance ranges for the Operating EBITDA, Operating EBITDA Margin, and Working Capital Turns metrics, the 2023 results relative to the business performance, and the payout factor for the enterprise PRP. Consistent with our framework for acquisition adjustments, the impact of the Biologicals acquisitions was
Corteva 2024 Proxy Statement | 43
COMPENSATION DISCUSSION AND ANALYSIS
2021-2023 Annual PSU Awards (PSUs Payable in 2024)
In January 2021, the Committee (and, in the case of the CEO, the Board) approved, as part of its LTI incentive program, a grant of PSUs utilizing ROIC and Operating EPS metrics in order to align executive compensation with our stockholders’ interest by prioritizing investment in growth. The actual number of shares earned for the PSUs granted in 2021 was based on the average of Corteva’s ROIC and Operating EPS growth metrics for the 3-year performance period, covering January 2021 through December 2023, as shown in the table below.
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| Metric |
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Weighting |
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|
Basis of Measurement |
| ROIC |
|
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50 |
% |
|
Average ROIC over the performance period |
| Operating EPS Growth |
|
|
50 |
% |
|
Average Operating EPS Growth over the performance period |
The performance period for the 2021 PSUs awarded in February 2021 ran from January 1, 2021 to December 31, 2023. The final number of shares earned was based on the above metrics over the performance period. The final payout determination was made in January 2024 after a review of the Company’s performance. ROIC Improvement performance (weighted 50%) resulted in a 146.1% payout factor. Operating EPS Growth performance (weighted 50%) resulted in an 125.7% payout factor. This resulted in an overall payout at 135.9% of target. Consistent with our framework for acquisition adjustments, the impact of the Biologicals acquisitions was excluded in determining the payout factor for the 2021-2023 PSU awards. See Appendix A to this Proxy Statement for a reconciliation and further information on the non-GAAP metrics utilized for the 2021-2023 PSU awards.
Consistent with our framework for acquisition adjustments, with more than 50% of the performance period remaining on PSUs awarded in 2022 and 2023, targets were adjusted to reflect the impacts of the Biologicals acquisitions. Further details are provided in the 2023 Option Exercises and Stock Vested Table. Target units and year-end values for PSUs awarded in 2022 and 2023 are included in the Outstanding Equity Awards Table.
2024 COMPENSATION DESIGN CHANGES
The Committee evaluated the design of its incentive programs for 2024 to further align with our strategic direction and the interest of our stockholders, including incentivizing behaviors that drive stockholder returns and values-driven leadership, as well as increase comparability between Corteva performance and its peers and drive results within our control. Consistent with utilizing metrics that allow stockholders more comparability to peers and that incentivize management to generate stockholder returns and support Corteva’s capital allocation strategy, the Committee approved replacing its Working Capital Turns metric with a Free Cash Flow metric within the 2024 enterprise PRP. The Free Cash Flow metric, like the current Working Capital Turns metric, will be weighted at 25%
For the business unit level PRP programs, for which only Messrs. Glenn and King participate, a cash metric, Working Capital as a Percentage of Revenue has been added to further incentivize our business units to contribute to the Company’s cash generation priorities in order to support Corteva’s capital allocation strategy, including providing returns to stockholders. With this change, the business unit PRP will be:
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• |
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50% weighted on an Operating EBITDA metrics (split evenly between business unit and enterprise Operating EBITDA performance); |
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• |
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25% weighted on Operating EBITDA Margin metrics (split evenly between business unit and enterprise Operating EBITDA Margin performance); and |
| |
• |
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25% weighted on metrics supportive of cash generation (with 12.5% being based on business unit Working Capital as a Percentage of Revenue and 12.5% being based on enterprise Free Cash Flow). |
Corteva 2024 Proxy Statement | 47
COMPENSATION OF EXECUTIVE OFFICERS
Narrative Discussion of Summary Compensation Table
Salary
Amounts shown in the “Salary” column of the table above represent base salary earned during 2023.
Stock Awards
Amounts shown in the “Stock Awards” column of the table above represent the aggregate grant date fair value of RSUs and PSUs computed in accordance with FASB ASC Topic 718. For PSUs, the aggregate grant date fair value is based upon the probable outcome of the performance conditions. This amount is consistent with the estimate of aggregate compensation cost to be recognized over the service period determined as of the grant date under FASB ASC Topic 718, excluding the effect of estimated forfeitures. See 2023 Grants of Plan-Based Awards — Grant Date Fair Value of Stock and Option Awards for a detailed discussion of the grant date fair value of stock awards.
Option Awards
Amounts shown in the “Option Awards” column of the table above represent the aggregate grant date fair value of stock options computed in accordance with FASB ASC Topic 718. Refer to 2023 Grants of Plan-Based Awards — Grant Date Fair Value of Stock and Option Awards for a detailed discussion of the grant date fair value of option awards.
Non-Equity Incentive Plan Compensation
Amounts shown in this column of the table above represent cash-based annual incentives under the PRP. Refer to Our Annual Compensation Program — Annual Short-Term Incentives for a detailed discussion of the calculation of individual results for payouts under the PRP for our NEOs.
Change in Pension Value and Nonqualified Deferred Compensation Earnings
Amounts shown in this column of the table above represent the estimated change in the actuarial present value of accumulated pension benefits for Mr. Glenn at retirement at age 65. Key actuarial assumptions for the present value of accumulated benefit calculation can be found in Note 18 (“Pension Plans and Other Post Employment Benefits”) to the Consolidated Financial Statements in Corteva’s Annual Report on Form 10-K for the year ended December 31, 2023. Assumptions are further described in the narrative discussion following the Pension Benefits table.
There were no above-market or preferential earnings during 2023 on nonqualified deferred compensation. Generally, earnings on nonqualified deferred compensation include returns on investments in seven core investment alternatives, interest accruals on cash balances, Corteva common stock returns, and dividend reinvestments. Interest is accrued on cash balances based on a rate that is traditionally less than 120% of the applicable federal long-term rate, and dividend equivalents are accrued at a non-preferential rate. In addition, the other core investment alternatives are a subset of the investment alternatives available to all employees under the Company’s Retirement Savings Plan (“RSP”). Accordingly, these amounts are not considered above-market or preferential earnings for purposes of, and are not included in, the 2023 Summary Compensation Table.
Accordingly, all amounts shown in this column reflect the change in the pension value under the Pension Plan and Pension Restoration Plan. The change in pension value represents the change in the present value from the prior measurement date of an NEO’s accumulated benefit as of the applicable pension measurement date.
Corteva 2024 Proxy Statement | 49
COMPENSATION OF EXECUTIVE OFFICERS
ended December 31, 2023. All other assumptions are consistent with those used in Note 17, except that the present value of accumulated benefit uses a retirement age at which the NEO may retire with an unreduced benefit under the Pension Plan. The valuation method used for determining the present value of the accumulated benefit is the traditional unit credit cost method.
NONQUALIFIED DEFERRED COMPENSATION
The following table provides information on Corteva’s defined contribution or other plans that provide for deferrals of compensation on a basis that is not tax-qualified. For a complete understanding of the table, refer to the narrative discussion that follows.
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| Name |
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Executive Contributions in Last Fiscal Year ($)(1) |
|
Company Contributions in Last Fiscal Year ($)(2) |
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Aggregate Earnings in Last Fiscal Year ($) |
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Aggregate Withdraws / Distributions ($) |
|
Aggregate Balance at Last Fiscal Year-End ($) |
| Charles V. Magro |
|
|
|
80,458 |
|
|
|
|
80,458 |
|
|
|
|
2,123 |
|
|
|
|
— |
|
|
|
|
169,788 |
|
| David J. Anderson |
|
|
|
119,794 |
|
|
|
|
119,794 |
|
|
|
|
120,099 |
|
|
|
|
— |
|
|
|
|
644,993 |
|
| Samuel R. Eathington, Ph.D. |
|
|
|
88,566 |
|
|
|
|
88,566 |
|
|
|
|
32,720 |
|
|
|
|
— |
|
|
|
|
249,344 |
|
| Timothy P.Glenn |
|
|
|
92,852 |
|
|
|
|
92,852 |
|
|
|
|
(89,253 |
) |
|
|
|
— |
|
|
|
|
1,422,321 |
|
| Robert D. King |
|
|
|
85,510 |
|
|
|
|
85,510 |
|
|
|
|
3,424 |
|
|
|
|
— |
|
|
|
|
194,496 |
|
| (1) |
Executive contributions are included in salary for 2023 in the Summary Compensation Table. |
| (2) |
Company contributions are included in All Other Compensation for 2023 in the Summary Compensation Table. |
Narrative Discussion of the Nonqualified Deferred Compensation Table
Corteva offers two nonqualified deferred compensation programs under which participants may voluntarily elect to defer some portion of base salary, PRP, or LTI awards until a future date. Deferrals are credited to an account and earnings are calculated thereon in accordance with the applicable investment option or interest rate. With the exception of the Retirement Savings Restoration Plan (“RSRP”), there are no Company contributions or matches. The RSRP was adopted to restore Company contributions for certain U.S. employees that would be lost due to IRC limits on compensation under Corteva’s tax-qualified savings plan.
The following provides an overview of the various deferral options as of December 31, 2023.
RSRP:
Under the RSRP, eligible employees can elect to defer eligible compensation (generally, base salary plus PRP) that exceeds the regulatory limits ($330,000 in 2023) in increments of 1% up to 6%. Corteva matches participant contributions on a dollar-for-dollar basis up to 6% of eligible pay. Corteva also makes an additional contribution of 3% of eligible compensation to participants in the RSRP as of December 31. The additional 3% contribution is made during the first quarter of the following calendar year. Participant investment options under the RSRP mirror the options available under the qualified plan. Distributions may be made in the form of a lump sum or annual installments after separation from service.
Management Deferred Compensation Program (“MDCP”):
Under the MDCP, a NEO can elect to defer the receipt of up to 60% of his base salary and/or PRP award. Corteva does not match deferrals under the MDCP. Participants may select from among seven core investment options under the MDCP, including Corteva common stock units with dividend equivalents credited as additional stock units. In general, distributions may be made in the form of a lump sum at a specified future date prior to separation from service or a lump sum or annual installments after separation from service.
In addition, under the MDCP, a NEO can elect to defer the receipt of 100% of his LTI awards (RSUs and/or PSUs). Corteva does not match LTI deferrals under the MDCP. LTI deferrals under the MDCP are in the form of Corteva common stock units with dividend equivalents credited as additional stock units.
54 | Corteva 2024 Proxy Statement
AGENDA ITEM 2:
ADVISORY RESOLUTION TO APPROVE
EXECUTIVE COMPENSATION
Pursuant to Section 14A of the Exchange Act and the related rules of the SEC, the Company seeks your vote to approve, on an advisory basis, the compensation of the Company’s named executive officers as disclosed in this Proxy Statement pursuant to the SEC’s compensation disclosure rules, including the Compensation Discussion and Analysis, the compensation tables, and the narrative disclosures that accompany the compensation tables (a “say-on-pay” vote).
As described in detail under the heading “Executive Compensation — Compensation Discussion and Analysis” in this Proxy Statement, the Board of Directors seeks to link a significant portion of executive officer compensation with the Company’s performance. The Company’s compensation programs are designed to reward the Company’s executive officers for the achievement of short-term and long-term financial goals, while minimizing excessive risk-taking. The Company’s executive compensation program is strongly aligned with the long-term interests of stockholders. The Company urges you to read the Compensation Discussion and Analysis section of this Proxy Statement for additional details on executive compensation programs, including compensation philosophy and objectives and the compensation of named executive officers during fiscal year 2023.
The vote on this proposal is not intended to address any specific element of compensation; rather, the vote relates to all compensation relating to the Company’s named executive officers, as described in this Proxy Statement. The vote is advisory and is not binding on the Company, the Board, or the People and Compensation Committee, and will not be construed as overruling a decision by, or creating or implying any additional fiduciary duty for, the Company, the Board, or the People and Compensation Committee. However, the Board and the People and Compensation Committee value the opinions expressed by stockholders in their votes on this proposal and will consider the outcome of the vote when making future compensation decisions and policies regarding the Company’s executive officers.
Accordingly, the Board of Directors and management ask stockholders to approve the following resolution at the Annual Meeting:
“RESOLVED , that the Company’s stockholders approve, on an advisory basis, the compensation of the named executive officers, as disclosed in the Company’s Proxy Statement for the 2024 Annual Meeting of Stockholders pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, the compensation tables and any related material disclosed in this Proxy Statement.”
The next “say on pay” advisory vote will occur at the Company’s 2025 Meeting. The Board of Directors unanimously recommends a vote FOR the approval of the Advisory Resolution to Approve Executive Compensation.
|
|
|
|
|
| ✔ |
|
AGENDA ITEM 2: ADVISORY RESOLUTION TO APPROVE EXECUTIVE COMPENSATION The Board of Directors recommends that you vote FOR this resolution. |
62 | Corteva 2024 Proxy Statement
AGENDA ITEM 4:
AMENDMENT TO CERTIFICATE OF INCORPORATION
The Delaware General Corporation Law (“DGCL”) was recently amended to permit Delaware companies to exculpate their officers, in addition to their directors, for personal liability in certain actions. After careful consideration, our Board adopted and approved, and has recommended that our stockholders adopt, an amendment to our Amended and Restated Certificate of Incorporation (the “Officer Exculpation Amendment”) to provide for the exculpation of certain of our officers pursuant to these recent amendments to the DGCL.
As amended, the DGCL only permits, and the Officer Exculpation Amendment would only permit, the exculpation of officers for claims that do not involve breaches of the duty of loyalty, acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law, or any transaction in which the officer derived an improper personal benefit. In addition, under the Officer Exculpation Amendment, the exculpation of officers would not apply to claims brought by or in the right of the Company, such as derivative claims.
The text of the Company’s Certificate of Incorporation as amended and restated is set forth in Appendix B. Taking into account the limits on the type of claims for which officers’ liability would be exculpated, and the benefits our Board believes would accrue to the Company and our stockholders in the form of an enhanced ability to attract and retain talented officers, the potential to discourage frivolous lawsuits that can distract management, and the potential to decrease the cost of directors’ and officers’ insurance or prevent the Company from obtaining such coverage in the future, our Board determined that it is in the best interests of the Company and our stockholders to adopt the Officer Exculpation Amendment. The Company’s executive officers have an interest in approval of the Officer Exculpation Amendment because it relates to the extent of their potential exposure to certain liabilities in certain circumstances.
If adopted, the Officer Exculpation Amendment would add to Article VI of our Amended and Restated Certificate of Incorporation a Paragraph C, as follows, with added text underlined:
C. Limitation of Liability of Officers. To the fullest extent permitted by the General Corporation Law of Delaware, as the same exists or as may hereafter be amended, an officer of the Company shall not be personally liable to the Company or its stockholders for monetary damages for breach of fiduciary duty as an officer except for liability (a) for any breach of the officer’s duty of loyalty to the Company or its stockholders; (b) for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law; (c) under Section 174 of the General Corporation Law of Delaware or (d) for any transaction from which the director or officer derived any improper personal benefit. If the General Corporation Law of Delaware is hereafter amended to authorize corporate action further eliminating or limiting the personal liability of directors or officers, then the liability of a director or officer of the Company shall be eliminated or limited to the fullest extent permitted by the General Corporation Law of Delaware, as so amended. For purposes of this Article VI, “officer” shall have the meaning provided in Section 102(b)(7) of the General Corporation Law of Delaware, as the same exists or may hereafter be amended.
The Board unanimously recommends that you vote FOR the Officer Exculpation Amendment.
|
|
|
|
|
| ✔ |
|
AGENDA ITEM 4: AMENDMENT TO ARTICLES OF INCORPORATION The Board of Directors recommends that you vote FOR the Officer Exculpation Amendment. |
66 | Corteva 2024 Proxy Statement
ADDITIONAL INFORMATION
FUTURE STOCKHOLDER PROPOSALS
If you satisfy the requirements of the rules and regulations of the SEC and wish to submit a proposal to be considered for inclusion in the Company’s proxy materials for the 2025 Meeting, pursuant to Rule 14a-8, please send it to the Office of the Corporate Secretary. Under SEC Exchange Act Rule 14a-8, these proposals must be received no later than the close of business on November 15, 2024.
FUTURE ANNUAL MEETING BUSINESS
Under the Company’s Bylaws, if you wish to raise items of proper business directly at an annual meeting, including Director nominations outside of the proxy access process, other than stockholder proposals presented under Rule 14a-8 for inclusion in the Company’s proxy materials, you must give advance written notification to the Office of the Corporate Secretary. For the 2025 Meeting, written notice must be received by the Office of the Corporate Secretary between the close of business on November 15, 2024, and the close of business on December 15, 2024. However, as provided in the Bylaws, different deadlines apply if the 2025 Meeting is called for a date that is not within 30 days before or after the anniversary of the 2024 Meeting; in that event, written notice must be received by the Office of the Corporate Secretary no earlier than the close of business on the 120th day prior to the 2024 Meeting anniversary date and no later than the close of business on the later of the 90th day prior to the 2024 Meeting anniversary date or the 10th day following the date on which public disclosure of the date of such meeting is first made by the Company. Such notices must comply with the procedural and content requirements of the Bylaws. If notice of a matter is not received within the applicable deadlines or does not comply with the Bylaws, the chair of the annual meeting may refuse to introduce such matter. If a stockholder does not meet these deadlines, or does not satisfy the requirements of Rule 14a-4 of the Exchange Act, the persons named as proxies will be allowed to use their discretionary voting authority when and if the matter is raised at the annual meeting. The full text of the Bylaws is available at https://investors.corteva.com/.
FUTURE DIRECTOR NOMINEES THROUGH PROXY ACCESS
Under the Company’s Bylaws, if you wish to nominate a director through proxy access, you must give advance written notification to the Office of the Corporate Secretary. For the 2025 Meeting, written notice must be received by the Office of the Corporate Secretary between the close of business on October 16, 2024, and the close of business on November 15, 2024. Such notices must comply with the procedural and content requirements of the Bylaws. The full text of the Bylaws is available at investors.corteva.com. To comply with the universal proxy rules, stockholders who intend to solicit proxies in support of director nominees other than the Company’s nominees must provide notice that sets forth the information required by Rule 14a-19 under the Exchange Act no later than February 25, 2025.
MULTIPLE STOCKHOLDERS WITH THE SAME ADDRESS
The SEC’s “householding” rules permit us to deliver only one notice or set of proxy materials to stockholders who share an address unless otherwise requested. This practice is designed to reduce printing and postage costs. If you are a registered stockholder and share an address with another stockholder and have received only one notice or one set of proxy materials, you may request a separate copy of these materials, and future materials, at no cost to you by writing to the Office of the Corporate Secretary. Alternatively, if you are currently receiving multiple copies of the notice or the proxy materials at the same address and wish to receive a single copy in the future, you may contact the Office of the Corporate Secretary. If you hold your stock with a bank or broker, you may revoke your consent to householding at any time by contacting Broadridge Financial Solutions Inc., 51 Mercedes Way, Edgewood, NY 11717, or by calling 1-866-540-7095. If you are a registered stockholder receiving multiple copies at the same address or if you have a number of accounts at a single brokerage firm, you may submit a request to receive a single copy in the future by contacting the Office of the Corporate Secretary. If you hold your stock with a bank or broker, contact Broadridge Financial Solutions Inc. at the address and telephone number provided above. The Company will promptly deliver to a stockholder who received one copy of proxy materials as the result of householding, a copy of the materials upon the stockholder’s written or oral request to the Office of the Corporate Secretary.
Corteva 2024 Proxy Statement | 67
Pay vs Performance Disclosure - USD ($)
|
2 Months Ended |
10 Months Ended |
12 Months Ended |
Dec. 31, 2021 |
Oct. 31, 2021 |
Dec. 31, 2023 |
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2020 |
| Pay vs Performance Disclosure |
|
|
|
|
|
|
| Pay vs Performance Disclosure, Table |
|
|
In accordance with Item 402(v) of Regulation S-K, the Company is required to disclose pay versus performance, or PVP by comparing compensation amounts previously reported for the last three calendar years to the SEC’s definition of “Compensation Actually Paid,” or CAP. Also as required by the SEC, this section compares CAP to various measures used to gauge performance at Corteva. CAP is a supplemental measure for stockholders, and is not a replacement for, or incorporated into the philosophy and strategy of compensation-setting set forth in the “Compensation Discussion and Analysis” of this proxy statement. Pay Versus Performance Table In determining the CAP for our NEOs, we are required to make various adjustments to amounts that have been previously reported in the Summary Compensation Table (the “SCT”) for the last four calendar years. The table below summarizes compensation values both previously reported in our SCT, as well as footnotes of the adjusted values for 2023.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Avg. SCT Total for Non-PEO NEOs (2) |
|
|
|
Value of Initial Fixed $100
Investment Based on: (4) |
|
Net
Income (6)
($ in
millions) |
|
Company
Selected
Measure (7) :
Operating
EPS ($) |
|
|
| |
|
|
Peer Group
Total
Shareholder
Return (5) |
2023 |
|
|
|
— |
|
|
|
$ |
13,234,872 |
|
|
|
|
— |
|
|
|
$ |
7,924,156 |
|
|
|
$ |
3,391,528 |
|
|
|
$ |
1,403,620 |
|
|
|
$ |
171 |
|
|
|
$ |
146 |
|
|
|
$ |
747 |
|
|
|
$ |
2.69 |
|
|
|
|
|
|
2022 |
|
|
|
— |
|
|
|
$ |
14,762,075 |
|
|
|
|
— |
|
|
|
$ |
16,983,522 |
|
|
|
$ |
5,027,523 |
|
|
|
$ |
7,408,698 |
|
|
|
$ |
207 |
|
|
|
$ |
132 |
|
|
|
$ |
1,158 |
|
|
|
$ |
2.67 |
|
|
|
|
|
|
2021 |
|
|
$ |
16,864,428 |
|
|
|
$ |
792,786 |
|
|
|
$ |
18,917,976 |
|
|
|
$ |
792,786 |
|
|
|
$ |
4,077,575 |
|
|
|
$ |
5,553,889 |
|
|
|
$ |
165 |
|
|
|
$ |
149 |
|
|
|
$ |
1,769 |
|
|
|
$ |
2.15 |
|
|
|
|
|
|
2020 |
|
|
$ |
10,749,544 |
|
|
|
|
— |
|
|
|
$ |
19,452,828 |
|
|
|
|
— |
|
|
|
$ |
2,596,002 |
|
|
|
$ |
4,885,371 |
|
|
|
$ |
133 |
|
|
|
$ |
118 |
|
|
|
$ |
701 |
|
|
|
$ |
1.50 |
|
|
|
|
|
|
| (1) |
Mr. Magro succeeded Mr. Collins as PEO in 2021 (on November 1, 2021). Mr. Collins served as the PEO for the entirety of 2020. Our Non- PEO NEOs for the applicable years were as follows: |
| |
• |
|
2023: David J. Anderson, Samuel R. Eathington, Timothy P. Glenn, and Robert D. King |
| |
• |
|
2022: David J. Anderson, Samuel R. Eathington, Timothy P. Glenn, and Robert D. King |
| |
• |
|
2021: David J. Anderson, Timothy P. Glenn, Cornel B. Fuerer, Gregory R. Friedman, and Rajan Gajaria |
| |
• |
|
2020: Gregory R. Friedman, Rajan Gajaria, Timothy P. Glenn, and Cornel B. Fuerer |
| (2) |
Amounts reported in these columns represent (i) the total compensation reported in the Summary Compensation Table (“SCT”) for the applicable year in the case of our PEOs, Mr. Collins and Mr. Magro, and (ii) the average of the total compensation reported in the SCT for the applicable year for our Non-PEO NEOs. |
| (3) |
Amounts reported in these columns represent (i) CAP for the applicable year in the case of our PEOs, Mr. Collins and Mr. Magro and (ii) the average CAP for the applicable year for our Non-PEO NEOs; adjustments were made to the amounts reported in the SCT for the applicable year. | A reconciliation of the adjustments made to the 2023 SCT amounts to calculate CAP for our PEO, Mr. Magro, and for the average of the Non-PEO NEOs is set forth in the table below. In this table, the unvested equity fair values were calculated on each of the required measurement dates using assumptions based on criteria consistent with those used for grant date fair value calculations and in accordance with the methodology used for financial reporting purposes. For unvested awards subject to performance-based vesting conditions, the fair values were based on the probable outcome of such performance-based vesting conditions as of the last day of the year.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less:
SCT
Reported
Change
in
Pension
Value |
|
Plus:
Pension
Value
Service
Cost |
|
Less: SCT
Reported
Stock Award
and Option
Value |
|
Plus (Less):
Fair Value of Equity
Awards
Granted
During 2023
that are
Outstanding
and Unvested at End of the
Covered Year |
|
|
|
|
|
|
|
|
|
|
PEO |
|
|
$ |
13,234,872 |
|
|
|
$ |
0 |
|
|
|
|
$0 |
|
|
|
$ |
10,250,043 |
|
|
|
$ |
7,395,789 |
|
|
|
($ |
2,592,295 |
) |
|
|
|
$0 |
|
|
|
$ |
135,833 |
|
|
|
|
$0 |
|
|
|
$ |
7,924,156 |
|
|
|
|
$ |
3,391,528 |
|
|
|
$ |
21,219 |
|
|
|
|
$0 |
|
|
|
$ |
1,925,098 |
|
|
|
$ |
1,388,988 |
|
|
|
($ |
789,830 |
) |
|
|
|
$0 |
|
|
|
($ |
640,750 |
) |
|
|
|
$0 |
|
|
|
$ |
1,403,620 |
|
| (4) |
Total Shareholder Return (“TSR”) is cumulative for the measurement periods beginning on December 31, 2019 and ending on December 31 of each of 2020, 2021, 2022 and 2023, respectively. TSR is calculated by dividing the difference between the price of the Company’s common stock at the end and the beginning of the measurement period by the price of the Company’s common stock at the beginning of the measurement period. |
| (5) |
The company utilized the S&P 500 Chemicals Index as its peer group for TSR, which is the industry index utilized in the Company’s Annual Report on Form 10-K. |
| (6) |
Reflects the Company’s net income (loss) reflected in the audited financial statements published in our Annual Report on Form 10-K for the applicable year. |
| (7) |
Operating EPS has been selected as the Company Selected Measure because the Company believes it is the most important measure linked to compensation actually paid, has a close association with the Company’s share price and TSR, and has been and is expected to continue to be a performance metric that is important to the Company and our stockholders. Refer to our 2023 Annual Report for a reconciliation of Operating EPS to EPS, the most directly comparable financial measure calculated and presented in accordance with US GAAP. |
|
|
|
|
| Company Selected Measure Name |
|
|
Operating EPS
|
|
|
|
| Named Executive Officers, Footnote |
|
|
| (1) |
Mr. Magro succeeded Mr. Collins as PEO in 2021 (on November 1, 2021). Mr. Collins served as the PEO for the entirety of 2020. Our Non- PEO NEOs for the applicable years were as follows: |
| |
• |
|
2023: David J. Anderson, Samuel R. Eathington, Timothy P. Glenn, and Robert D. King |
| |
• |
|
2022: David J. Anderson, Samuel R. Eathington, Timothy P. Glenn, and Robert D. King |
| |
• |
|
2021: David J. Anderson, Timothy P. Glenn, Cornel B. Fuerer, Gregory R. Friedman, and Rajan Gajaria |
| |
• |
|
2020: Gregory R. Friedman, Rajan Gajaria, Timothy P. Glenn, and Cornel B. Fuerer |
|
|
|
|
| Peer Group Issuers, Footnote |
|
|
The company utilized the S&P 500 Chemicals Index as its peer group for TSR, which is the industry index utilized in the Company’s Annual Report on Form 10-K.
|
|
|
|
| Adjustment To PEO Compensation, Footnote |
|
|
| (3) |
Amounts reported in these columns represent (i) CAP for the applicable year in the case of our PEOs, Mr. Collins and Mr. Magro and (ii) the average CAP for the applicable year for our Non-PEO NEOs; adjustments were made to the amounts reported in the SCT for the applicable year. | A reconciliation of the adjustments made to the 2023 SCT amounts to calculate CAP for our PEO, Mr. Magro, and for the average of the Non-PEO NEOs is set forth in the table below. In this table, the unvested equity fair values were calculated on each of the required measurement dates using assumptions based on criteria consistent with those used for grant date fair value calculations and in accordance with the methodology used for financial reporting purposes. For unvested awards subject to performance-based vesting conditions, the fair values were based on the probable outcome of such performance-based vesting conditions as of the last day of the year.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less:
SCT
Reported
Change
in
Pension
Value |
|
Plus:
Pension
Value
Service
Cost |
|
Less: SCT
Reported
Stock Award
and Option
Value |
|
Plus (Less):
Fair Value of Equity
Awards
Granted
During 2023
that are
Outstanding
and Unvested at End of the
Covered Year |
|
|
|
|
|
|
|
|
|
|
PEO |
|
|
$ |
13,234,872 |
|
|
|
$ |
0 |
|
|
|
|
$0 |
|
|
|
$ |
10,250,043 |
|
|
|
$ |
7,395,789 |
|
|
|
($ |
2,592,295 |
) |
|
|
|
$0 |
|
|
|
$ |
135,833 |
|
|
|
|
$0 |
|
|
|
$ |
7,924,156 |
|
|
|
|
$ |
3,391,528 |
|
|
|
$ |
21,219 |
|
|
|
|
$0 |
|
|
|
$ |
1,925,098 |
|
|
|
$ |
1,388,988 |
|
|
|
($ |
789,830 |
) |
|
|
|
$0 |
|
|
|
($ |
640,750 |
) |
|
|
|
$0 |
|
|
|
$ |
1,403,620 |
|
|
|
|
|
| Non-PEO NEO Average Total Compensation Amount |
|
|
$ 3,391,528
|
$ 5,027,523
|
$ 4,077,575
|
$ 2,596,002
|
| Non-PEO NEO Average Compensation Actually Paid Amount |
|
|
$ 1,403,620
|
7,408,698
|
5,553,889
|
4,885,371
|
| Adjustment to Non-PEO NEO Compensation Footnote |
|
|
| (3) |
Amounts reported in these columns represent (i) CAP for the applicable year in the case of our PEOs, Mr. Collins and Mr. Magro and (ii) the average CAP for the applicable year for our Non-PEO NEOs; adjustments were made to the amounts reported in the SCT for the applicable year. | A reconciliation of the adjustments made to the 2023 SCT amounts to calculate CAP for our PEO, Mr. Magro, and for the average of the Non-PEO NEOs is set forth in the table below. In this table, the unvested equity fair values were calculated on each of the required measurement dates using assumptions based on criteria consistent with those used for grant date fair value calculations and in accordance with the methodology used for financial reporting purposes. For unvested awards subject to performance-based vesting conditions, the fair values were based on the probable outcome of such performance-based vesting conditions as of the last day of the year.
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Less:
SCT
Reported
Change
in
Pension
Value |
|
Plus:
Pension
Value
Service
Cost |
|
Less: SCT
Reported
Stock Award
and Option
Value |
|
Plus (Less):
Fair Value of Equity
Awards
Granted
During 2023
that are
Outstanding
and Unvested at End of the
Covered Year |
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PEO |
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|
$ |
13,234,872 |
|
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|
$ |
0 |
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|
$0 |
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|
$ |
10,250,043 |
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|
$ |
7,395,789 |
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|
($ |
2,592,295 |
) |
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|
$0 |
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|
$ |
135,833 |
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|
$0 |
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|
$ |
7,924,156 |
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|
$ |
3,391,528 |
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|
$ |
21,219 |
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|
$0 |
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|
$ |
1,925,098 |
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|
$ |
1,388,988 |
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|
($ |
789,830 |
) |
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|
$0 |
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($ |
640,750 |
) |
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$0 |
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$ |
1,403,620 |
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| Compensation Actually Paid vs. Total Shareholder Return |
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|
Relationship between CAP and TSR . The graph below reflects the relationship between the PEO and average Non-PEO NEO compensation actually paid (“CAP”) and the Company’s cumulative indexed Total Shareholder Return, or TSR, (assuming an initial fixed investment of $100) over the applicable measurement period.
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| Compensation Actually Paid vs. Net Income |
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|
Relationship between CAP and GAAP Net Income . The graph below reflects the relationship between the PEOs and Average Non-PEO NEO CAP and the Company’s GAAP Net Income over the applicable measurement period.
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| Compensation Actually Paid vs. Company Selected Measure |
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|
Relationship between CAP and Operating EPS (our Company-Selected Measure). The graph below reflects the relationship between the PEOs and average Non-PEO NEOs CAP and the Company’s Non-GAAP Operating Earnings Per Share over the applicable measurement period.
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| Total Shareholder Return Vs Peer Group |
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|
Relationship between CAP and TSR . The graph below reflects the relationship between the PEO and average Non-PEO NEO compensation actually paid (“CAP”) and the Company’s cumulative indexed Total Shareholder Return, or TSR, (assuming an initial fixed investment of $100) over the applicable measurement period.
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| Tabular List, Table |
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|
Performance Measures Used to Link Company Performance and CAP. The Company utilizes other important financial measures to link compensation actually paid to its NEOs performance as set forth in the table below.
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| |
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|
(1) |
|
Absolute Total Shareholder Return |
(2) |
|
Operating Earnings Per Share |
(3) |
|
Operating EBITDA Margin |
(4) |
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Return on Net Assets |
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| Total Shareholder Return Amount |
|
|
$ 171
|
207
|
165
|
133
|
| Peer Group Total Shareholder Return Amount |
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|
146
|
132
|
149
|
118
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| Net Income (Loss) |
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|
$ 747,000,000
|
$ 1,158,000,000
|
$ 1,769,000,000
|
$ 701,000,000
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| Company Selected Measure Amount |
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|
2.69
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2.67
|
2.15
|
1.5
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| Measure:: 1 |
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| Pay vs Performance Disclosure |
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| Name |
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Absolute Total Shareholder Return
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| Measure:: 2 |
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| Pay vs Performance Disclosure |
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|
| Name |
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|
Operating Earnings Per Share
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|
| Measure:: 3 |
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| Pay vs Performance Disclosure |
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|
|
|
|
| Name |
|
|
Operating EBITDA Margin
|
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|
| Measure:: 4 |
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| Pay vs Performance Disclosure |
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| Name |
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Return on Net Assets
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| Mr. Magro [Member] |
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| Pay vs Performance Disclosure |
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| PEO Total Compensation Amount |
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|
$ 13,234,872
|
$ 14,762,075
|
$ 792,786
|
$ 0
|
| PEO Actually Paid Compensation Amount |
|
|
$ 7,924,156
|
$ 16,983,522
|
792,786
|
0
|
| PEO Name |
Mr. Magro
|
|
Mr. Magro
|
Mr. Magro
|
|
|
| Mr. Collins [Member] |
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| Pay vs Performance Disclosure |
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| PEO Total Compensation Amount |
|
|
$ 0
|
$ 0
|
16,864,428
|
10,749,544
|
| PEO Actually Paid Compensation Amount |
|
|
0
|
$ 0
|
$ 18,917,976
|
$ 19,452,828
|
| PEO Name |
|
Mr. Collins
|
|
|
|
Mr. Collins
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| PEO | Mr. Magro [Member] | SCT Reported Change in Pension Value [Member] |
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| Pay vs Performance Disclosure |
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| Adjustment to Compensation, Amount |
|
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0
|
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|
| PEO | Mr. Magro [Member] | Pension Value Service Cost [Member] |
|
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| Pay vs Performance Disclosure |
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| Adjustment to Compensation, Amount |
|
|
0
|
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|
| PEO | Mr. Magro [Member] | SCT Reported Stock Award and Option Value [Member] |
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|
|
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| Pay vs Performance Disclosure |
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| Adjustment to Compensation, Amount |
|
|
10,250,043
|
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|
| PEO | Mr. Magro [Member] | Fair Value of Equity Awards Granted During 2023 that are Outstanding and Unvested at End of the Covered Year [Member] |
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| Pay vs Performance Disclosure |
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| Adjustment to Compensation, Amount |
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7,395,789
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| PEO | Mr. Magro [Member] | Fair value of Equity Awards Granted in Any Prior Year that are Outstanding and Unvested at End of the Covered Year [Member] |
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| Pay vs Performance Disclosure |
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|
|
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|
| Adjustment to Compensation, Amount |
|
|
(2,592,295)
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|
| PEO | Mr. Magro [Member] | Fair Value at Vesting Date of Awards Granted and Vested During the Covered Year [Member] |
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| Pay vs Performance Disclosure |
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| Adjustment to Compensation, Amount |
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0
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| PEO | Mr. Magro [Member] | Change in Fair Value of Equity Awards granted in Prior Years that Vested During the Covered Year [Member] |
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| Pay vs Performance Disclosure |
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| Adjustment to Compensation, Amount |
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135,833
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| PEO | Mr. Magro [Member] | Fair Value of Equity Awards Granted in Prior Year that were Forfeited During the Covered Year [Member] |
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| Pay vs Performance Disclosure |
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| Adjustment to Compensation, Amount |
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0
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| Non-PEO NEO | SCT Reported Change in Pension Value [Member] |
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| Pay vs Performance Disclosure |
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| Adjustment to Compensation, Amount |
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21,219
|
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|
| Non-PEO NEO | Pension Value Service Cost [Member] |
|
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|
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| Pay vs Performance Disclosure |
|
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|
|
|
|
| Adjustment to Compensation, Amount |
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0
|
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|
| Non-PEO NEO | SCT Reported Stock Award and Option Value [Member] |
|
|
|
|
|
|
| Pay vs Performance Disclosure |
|
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|
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|
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| Adjustment to Compensation, Amount |
|
|
1,925,098
|
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|
| Non-PEO NEO | Fair Value of Equity Awards Granted During 2023 that are Outstanding and Unvested at End of the Covered Year [Member] |
|
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|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
|
| Adjustment to Compensation, Amount |
|
|
1,388,988
|
|
|
|
| Non-PEO NEO | Fair value of Equity Awards Granted in Any Prior Year that are Outstanding and Unvested at End of the Covered Year [Member] |
|
|
|
|
|
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| Pay vs Performance Disclosure |
|
|
|
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|
| Adjustment to Compensation, Amount |
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|
(789,830)
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| Non-PEO NEO | Fair Value at Vesting Date of Awards Granted and Vested During the Covered Year [Member] |
|
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| Pay vs Performance Disclosure |
|
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| Adjustment to Compensation, Amount |
|
|
0
|
|
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|
| Non-PEO NEO | Change in Fair Value of Equity Awards granted in Prior Years that Vested During the Covered Year [Member] |
|
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|
|
|
|
| Pay vs Performance Disclosure |
|
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|
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|
| Adjustment to Compensation, Amount |
|
|
(640,750)
|
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|
| Non-PEO NEO | Fair Value of Equity Awards Granted in Prior Year that were Forfeited During the Covered Year [Member] |
|
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|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
|
| Adjustment to Compensation, Amount |
|
|
$ 0
|
|
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|